State, federal challenges loom

Published 2:39 pm, Wednesday, November 28, 2012

Gridlock in the nation's capital and years of poor financial management in Hartford have led to serious budget problems that must be addressed and resolved immediately.

Due in part to partisan bickering in Washington, D.C., the federal government has pushed the country to what many are calling the fiscal cliff. And if the two sides can't make a reasonable deal by Dec. 31, the American economy is predicted to take a hit, and nearly every taxpayer, resident and business in the country will suffer.

If there is no deal by the end of the year, income taxes will go up across the board on Jan. 1, massive spending cuts will automatically go into effect, and there is the fear that such a combination of forces will trigger a return to recession.

A good starting point would be for the House to pass a bill already approved by the Senate that would reduce taxes on the first $250,000 made by every taxpayer -- legislation that would go a long way toward ensuring continued economic recovery.

If a deal is reached soon, businesses can feel more free to hire, consumers will be more likely to spend money in the holiday season and beyond, and the stock market will be more likely to remain strong.

The situation in Hartford does not affect as many people as the one in Washington, but it is serious and requires prompt and continuing attention.

Gov. Dannel P. Malloy inherited a $3.5 billion deficit when he took office two years ago, and his administration has been able to reduce the deficit to about $365 million, with a good chunk of the solution being tax increases.

However, the governor did not realize as much savings as hoped for from negotiations with state unions and from consolidation of state agencies. And Connecticut has been hurt by the slower-than-anticipated recovery of the national and world economy. Now Malloy's budget czar, Ben Barnes, is saying the state may be facing annual deficits of about a billion dollars for the next few years.

Malloy reportedly plans to put a dent in this year's deficit this week by ordering more than $150 million in immediate spending cuts, and more cuts will inevitably be in the offing in the coming months and years.

In light of those necessary actions, we caution the public to be braced for reductions in state services. These are difficult times, and they call for wise and courageous leadership from those we have entrusted to govern our state and our country.